‘Exponential disruption’ may sound worrying, but its all about staying relevant
What are you willing to exchange for data about yourself, bearing in mind that if you’re not buying a product — you are the product
I often hear people say, “We are living in an era of exponential disruption.” But what does that actually mean, and how will it affect us? First we need to understand the meaning of disruption and the nature of exponential.
Disruption, or disruptive technology, generally suggests that by doing something differently or adding a technological solution to a particular industry, one can change the course of that industry.
These game-changing additions will open that industry up to opportunities it previously never considered. The exponential nature refers to the rate of change of the disruption; this is explained by Moore’s Law, which states that approximately every two years, technology will double in processing power and halve in cost. This is partially the reason it took us about 20 years to develop personal computing to its current state, but the same level of development of the smartphone took about five years, and far less money.
If we hold Moore’s Law true for machine learning and artificial intelligence (AI), it means we are in an era where this technology will most likely develop an accelerated rate. In fact, if we believe that we are on the cusp of the exponential growth spurt, we are in for a very interesting next 20 years.
Data powers technology
If we assume that most large businesses realise it is essential to adopt technology in various forms to stay relevant in the market, then it would be true that for many of these technologies, data would be the input that would power them. We can consider this the independent variable.
We could also assume that the sorts of business we are talking about would probably adopt these new technologies at a reasonably similar timeframe in the next few years, as they become available in the market. We can consider these technologies the dependent variables.
Ultimately these technologies, mainly AI, which all these businesses adopt will depend on the data they are fed: those who receive the best data and who receive the data first. It will become a data race, competing for marginal advantage, which will become more significant at an accelerating rate.
If you are not buying a product, you are the product. However, as our data become so much more valuable to businesses that are trying to keep up with technology changing at an exponential rate, will we be willing to just give it away so freely?
Practically, this means that a business that collects the best data in the next five years will have a slight advantage over its competitors; the same scenario the following five years will give a business a huge advantage; and the following five years could be mean the difference with regards to staying relevant in the market.
The exciting part is that because this data is mainly about us, it is our data, and we own it. This includes most Internet of Things (IoT) connected devices: the way we shop, how often we attend the gym or even how much TV we watch. Historically, and currently, we have been happy to share this data quite freely with companies such as Facebook and Instagram, because we got a relatively low value exchange — we could use their platform on which they served us advertising.
If you are not buying a product, you are the product. However, as our data become so much more valuable to businesses that are trying to keep up with technology changing at an exponential rate, will we be willing to just give it away so freely? If we eventually understand that our data will make organisations relevant or irrelevant, will we expect more in return for our data? What will organisations have to do to get our data if people are expecting more value in exchange?
Creating or replacing human jobs?
One of the main arguments of technological disruption is that it will replace human jobs. Many technology advocates respond by suggesting that rather than replacing jobs, it will create new jobs that will only become possible due to this technology. This is particularly true for the Big Data evolution; as our data becomes more valuable, the immersion of a complimentary, Big Data industry is inevitable.
In the not too distant future, data risk management will become crucial. Just as we diversify our money, and would not put all our eggs in one basket, the same will become true for our data; we will need to protect it against single-entry hacks. As a result, we may see the creation of diversification by data-grouping — separating different types of data, such as health data, financial data and insurance data, into different storage mechanisms — possibly using blockchain technology.
We may see the emergence of data brokers. In the same way we have insurance brokers and financial products brokers, bidding clients’ money to companies with the most competitive products in the market, this may happen with our data too. If companies need to offer a higher value exchange for our data as time progresses, data brokers may become the middlemen who barter this exchange, matching the highest bidder for the most relevant data.
Lastly, we need to consider a longer-term, fully fledged, data-driven currency. A currency is essentially just an agreeable store of value that is commonly accepted by a group of people. If data becomes an asset that is commonly accepted as valuable, given its potential to make or break organisations, then would it be tradable for other goods and services? Although the optics are complicated, methodologies, such as tokenisation, suggest that this is not impossible, and we have already seen the rapid uptake of new currencies in light of the recent crypto-craze.
While these ideas may sound like something out of Star Trek, it is important to not forget our current position on the exponential growth curve: we are at the tipping point. The rate at which we are developing will only keep accelerating, and so all these ideas may become a reality far quicker than we anticipate.
Evidently there will be many threats and opportunities that arise from all this change, but it is our individual responsibility to educate ourselves to be best positioned to take full advantage, rather than fall behind.
• Pollack is a co-founder of En-novate.